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Older is better when it comes to insurance

written by M_Horgan
21.10.09 Posted in Insurance 0 0

Maybe it’s time to settle down a bit – find a good wife, comb through your financial details and trade up to a bigger car.

Avoid accidents for happy motoring (picture posed)Avoid accidents for happy motoring (picture posed)

The rush to get places may begin to ease if you’re heading for the big 3 0, but it doesn’t mean an end to mid-week poker nights with the lads, or long nights out on the town. And even if you feel that 30 is the new 20, you can thank your lucky stars that statisticians work with your actual age.

Although you are not quite out of the high-risk category in terms of car insurance, quotes should be getting more competitive, provided you have had no recent accidents. If you are a 25-year-old male with a five year No Claims Bonus (NCB), chances are you’ll be paying at least €550 on your car insurance, and probably up to a few hundred euro more.

It’s a large lump sum by any standards and it would be higher if the NCB was anything less than five years old. It’s far more likely that you’ll have a five year NCB at the age of 30, rather than 25, as long as you’re not accident prone.

Built in no claims bonus protection

With a built-in no claims bonus protection in most policies, an accident which took place four years ago is unlikely to affect your NCB today. In the event of a claim taking place in recent years, it may take just two years to work back to a full NCB. But the cost of your annual policy during those two years is sure to sting badly, as costs shoot up following a claim.

“It’s important for all young drivers to build up their no-claims bonus. It has a massive impact on the cost of insurance,” says Dublin broker Ronan Garvan. Car insurance is considerably easier on the pocket for young women than young men. But the competitive rate of €290 for fully comprehensive offered by 123.ie is only open to women who are 35-years-old or over.

A 25-year-old female accountant living in Galway, with one penalty point, and a five year NCB, can expect to get car insurance for €387 with Sertus.

The rate applies to a 1.4 litre Toyota Corolla car, valued at €8,000.

Sun or ski holiday?

If living in Dublin, the cost is considerably higher, with Kennco charging €447 for insurance on the same car. Living costs are generally higher in Dublin than elsewhere in the country, but car insurance is particularly high. One of the first questions which a broker or online insurance company will ask you is where you are located.

If you live in Galway, for example, the cost of your insurance will be akin to what you would pay on a sun holiday. But in Dublin, it’s more likely to be the price of a skiing holiday.

“People who move location should not forget to tell their broker as insurance costs vary, depending on what city you live in,” says Kenneth Keary, a broker in Loughrea, Co Galway. The quotes for the 25-year-old female accountant above do not include a named driver on the policy, however, the cost of adding a named driver on to a policy may not be that much. In some cases, it is even added for free by insurance companies, depending on the age of the named driver and whether or not s/he has a full licence.

A 25-year-old male accountant, driving a Toyota Corolla, with one penalty point and a five year NCB, will pay considerably more. Despite the safe and cautious reputation of accountants, when young men in this profession do the maths, they realise they are still classed in a high-risk category.

In Galway, the accountant is likely to get insurance with Axa for €558. But in Dublin insurance companies will quote a far higher number, with Kennco offering one of the cheapest quotes at €714.

Costs more in the Capital

“Costs are always going to be higher in Dublin, given the level of traffic flow in, out and around the city,” says Mr Garvan. For anyone over 25, with a NCB of three to five years, Kennco have been found to provide highly competitive quotes.

You may be surprised that a company which sounds like it produces coffee has become so popular with Irish customers, but Kennco is a UK underwriting agency which a growing number of Irish brokers have access to. Kennco, which began trading in September 2008, works with some of the biggest insurance companies to provide lower prices in insurance.

Brokers in Ireland have access to Kennco through software known as the Open GI system. They have welcomed the addition of Kennco on to their computer screens, as companies such as this one provide better value for consumers.

But despite the emergence of this company and increased competition in insurance, young men will always pay way above the odds on the road.

M_Horgan

Michele Horgan lives with her husband in Galway, the most party-friendly town in the country. When not out and about enjoying music and beer up west, she's likely to be in Barcelona eating tapas down by the port area - her favourite spot.

M_Horgan
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